Thank you Mr. Chairman and distinguished Members of the Subcommittee, for the
opportunity to share with you the Administration's view on the important
relationship we are building with the Russians through the Gore-Chernomyrdin
Commission. Although the Vice President was unable to appear today, he
wanted me to extend his personal thanks to you Mr. Chairman, for your
letter of invitation and the opportunity to share our views.

I would like to begin with some background. I think all of us here today would
agree that since the events of August, 1991, we have witnessed a dramatic and
fundamental change take place in the former Soviet Union. This change has
opened up new vistas in our cooperative relationship with Russia, allowing us
to leave behind the vestiges of the Cold War and develop a new partnership.

The vision of this new relationship was first sketched out by President Clinton
and President Yeltsin during their summit in Vancouver. The two Presidents
agreed to establish a Joint Commission, headed by Vice President Gore and Prime
Minister Chernomyrdin, to transform this vision into reality. As you know, Mr.
Chairman, the Vice President and the Prime Minister met in early September to
initiate the work of the Commission. What I would like to do today is provide
the Subcommittee with a fuller understanding of the results of this first
meeting, not only as they relate to space, but also the other areas under the
Commission.

Let me begin with the Committee on Space Cooperation, since I know it is the
focus of the Subcommittee's interest.

I think we all recall, Mr. Chairman, the Apollo-Soyuz project of 1975 which
demonstrated, for the first time, that the U.S. and Russian space
programs--even under the most difficult circumstances--could work together. We
now have an historic opportunity to combine our efforts in space across a
spectrum of programs, not in the context of an adversarial relationship, but
rather, one that is based on cooperation and partnership.

We believe that the steps taken during the Gore-Chernomyrdin meeting will set
us on a course which will allow us to work together on space activities to
minimize costs, maximize research potential and reduce the time needed to do
projects.

In the area of human space flight, we intend to undertake a phased program of
cooperation that will have clear cut advantages for both sides. Phase one
involves expanding the number of rendezvous and docking missions between the
U.S. Space Shuttle and the Russian Mir space station. In this initial phase,
we will also have an opportunity to fly long duration missions on board the Mir
space station. These activities will help us gain experience in preparation
for rendezvous and docking missions with the U.S.-led international Space
Station.

In the second phase of this program, we will examine the possible use of a Mir
module, flown in conjunction with a U.S. lab and serviced by the Shuttle, as an
interim human-tended science facility. This phase of the program could provide
an on-orbit facility that would allow us to conduct precursor activities in
utilization and operations.

We are working with the Russians and consulting with our current partners
regarding a third phase of this program consisting of possible Russian
participation in the U.S.-led international space station program. NASA and
the Russian Space Agency will develop a detailed plan by November 1 which will
address how this phase could be implemented.

The President believes that the Space Station program represents an important
international partnership between the United States, Canada, Europe, and Japan.
He also believes that we now have an historic opportunity to include Russia in
this endeavor, thereby not only putting the Cold War farther behind us, but
also adding a positive new dimension to the development of an international
space station. I know that he views this possibility as an important element
of the new relationship we are developing with Russia and is representative of
the type of project where we can work together to shape a more desirable
future

Alongside the initiative in human space flight, the Gore-Chernomyrdin meeting
produced agreements to expand cooperation in space sciences and environmental
observation as well as fundamental research in aeronautical sciences.

In this first area--space science and environmental observations--NASA and NOAA
will be working closely with the Russian Space Agency to study the feasibility
of a range of cooperative programs. This is a promising new venture where both
sides will examine how to increase international cooperation to minimize costs,
avoid duplication and increase the scope and effectiveness of work in these
areas. In the second area--aeronautics--we will pursue the negotiation of an
MOU with the Russians which will provide a framework for
government-to-government cooperation. The Russians have developed a very
robust aeronautics capability and we are eager to begin a dialogue that can
benefit both sides. Our desire is to have the MOU signed and in force by early
November.

During the Commission meeting, the Vice President and the Prime Minister also
signed a U.S.-Russian Commercial Space Launch Agreement. The agreement opens
the international commercial space launch market to Russia, under measured and
equitable conditions. The agreement establishes basic rules for the commercial
space launch market concerning government involvement in such areas as
subsidies, market inducements, and corrupt business practices. In our view,
the agreement reflects Russia's commitment to enter the international
marketplace in a fair and responsible manner.

At this point, I would like to emphasize two extremely important points.

First, Mr. Chairman, we must recognize that this initiative in space
cooperation fits into the context of a much larger partnership with Russia, a
relationship that will define the post-Cold War era. Our negotiations with the
Russians in preparation for the first Commission meeting produced a key
understanding that Russia is committed to adhere to the guidelines of the
Missile Technology Control Regime, one of the most important international
regimes for the nonproliferation of weapons technology. This MTCR commitment
is a strong signal that Russia is prepared to be a consistent and responsible
partner, one we can work with over the long term.

Second, I want to emphasize that the Space Station will be a U.S.-led
international space station. As you recall, in March of this year, the
President requested a review of the Space Station Freedom Program in order to
examine whether the program's development, operations, and utilization costs
could be significantly reduced while still achieving our scientific research
goals and fulfilling our international commitments. On June 17, following a
review of NASA's study by an independent panel of experts headed by Dr. Charles
Vest, President of MIT, the President announced his support for a scaled-down
modular version of Space Station Freedom that meets these objectives. The
President also called for pursuing expanded international involvement in the
space station with the possible participation of Russia.

We believe that the Space Station Alpha program meets these objectives. It
will not only provide power, a microgravity environment and scientific
facilities comparable to Space Station Freedom, but do so at less cost.
Additionally, the Space Station Alpha design allows us to maintain our
international commitments while also accommodating the possibility of Russian
participation.

With respect to potential Russian participation, however, no one should confuse
the course we are charting with relinquishing control of the Space Station or
exporting jobs out of the U.S. In developing this cooperative program, we are
focusing on areas that will not negatively impact the U.S. aerospace sector.
We intend to proceed in a way that protects our vital domestic interests while
maximizing the benefit we can derive from fuller interaction with the Russians.
In some areas, such as solar dynamic power, and possibly closed life support
systems , we believe that the net gain of new technologies from the Russians
could stimulate jobs in the U.S.

I know the Subcommittee will hear in detail from NASA Administrator Goldin on
the specific technical elements of the phased program I've described as well as
the activities in space science, environmental observations and aeronautics.
The primary message I want to convey to you is the Administration's commitment
to the Space Station Alpha program as a national science and technology
priority and our enthusiasm about the opportunities we see emerging from
cooperation with Russia.

During the first meeting of the Joint Commission on Energy and Space, the Vice
President and Prime Minister also agreed on the agenda of five committees in
addition to the Space Committee. I would like briefly to review some of the
key objectives and activities of the other committees. One of the immediate
objectives of the Energy Committee will be to work closely with the Russians to
strengthen the role for U.S. firms in the Russian oil and gas sector. The near
term emphasis will be on removing bureaucratic obstacles to implementing the
many U.S. private sector oil and gas projects that are on the table. During
the Commission meeting, for example, we were able to announce the final
arrangements for a project in Western Siberia. In this project, the Overseas
Private Investment Corporation will provide $28 million in loan guaranty and
insurance support for Texaco's $80 million oil well restoration project in
Western Siberia. This is illustrative of what we want to accomplish across the
board to increase both the number of projects and also increase employment
opportunities in Russia. In the longer term, we also hope that the Energy
Committee will be a useful forum to exchange views on policy development and
regulatory processes, particularly as the Russian Government wrestles with the
need to put energy legislation in place.

The Energy Committee will also oversee joint work emphasizing efficient and
environmentally sensitive ways to produce and utilize energy resources as well
as acceleration of our joint efforts in the area of nuclear safety. During
this first Commission meeting, we agreed to initiate a joint study to examine
more effective ways to ensure reactor safety. We are also committed to making
progress on nuclear liability protection, with hopes of coming to closure on a
liability agreement very soon. I know Secretary O'Leary recently visited
Moscow to continue discussions on these topics and I am confident we will see
progress as a result.

The second committee, the Business Development Committee, chaired by Secretary
Brown, is working to improve market access across a wide range of energy and
technology areas. Opening new markets on each side will create a win-win
situation for both the U.S. and Russia. The Business Development Committee
will serve as a forum to advocate specific trade and investment projects, also
serving as a "matchmaker" between U.S. and Russian firms in energy, aerospace
and other areas. One specific step this committee will soon take is the
appointment of U.S. and Russian ombudsmen to work with firms to overcome
obstacles to business and investment.

The Administration is convinced that a strong role for the private sector
through enhanced trade and investment can support Russia's economic reform.
Through Secretary Brown's Committee, we are working with the Russians to create
a business climate that is conducive to U.S. private sector investment by
developing a legal and commercial framework to normalize business relations
between our two countries.

In the remaining three areas, Environment, Science and Technology, and Defense
Diversification, we are just beginning to set our agenda. The Vice President
and the Prime Minister agreed to establish these committees during the first
Commission meeting. I expect the program of work will be fully developed in
time for the next full Commission meeting in late November or early December.

I would note, however, that we see the Environment and Science and Technology
Committee as having a cross-cutting function. We want to be sure that the
benefits of our cooperation in the environmental area flow through and impact
activities underway in the Energy Committee. Similarly, we will need to have a
close coupling between the Science and Technology Committee and the Environment
and Energy Committees.

In closing, I think it is fair to say that we face a major challenge and
opportunity in our work with Russia. The challenge, clearly, will be to turn
forty years of competition into a future of cooperation. The opportunity lies
in creating a more peaceful and prosperous world. The Administration has
seized this challenge with vigor and, working with the Congress, we are
confident it is the right course for both nations. Thank you Mr. Chairman.